Slide 1: TomTom Conference Call Third Quarter 2007 Financial Results
TomTom Conference Call Third quarter 2007 Financial Results 24 October 2007 Harold Goddijn - CEO Marina Wyatt - CFO © 2007 TomTom Third Quarter 2007 Financial Results
Slide 2: Disclaimer
Disclaimer This Presentation has been produced by TomTom N.V. (the “Company”) and is furnished to you solely for your information. This document contains certain forward-looking statements relating to the business, financial performance and results of the Company and the industry in which it operate
Slide 3: Offer for Tele Atlas - Update
Offer for Tele Atlas - Update • Offer Memorandum published on 2 October • Acceptance period commenced 3 October and will close 4 December (unless extended) • TomTom was advised that the waiting period pursuant to the HSR Act was terminated on 15 October • TomTom filed Form CO with the European Commi
Slide 4: Third Quarter 2007 Results
Third Quarter 2007 Results © 2007 TomTom Third Quarter 2007 Financial Results
Slide 5: Third Quarter Highlights
Third Quarter Highlights • €427 million revenue • Record number of 2.2 million PNDs shipped • Record gross margin of 49% and operating margin of 31% • Record net profit of €99 million • Record cash generation of €153 million • New products and Map Share™ technology delivered 5 © 2007 TomTom Third Qu
Slide 6: Rapid Market Growth
Rapid Market Growth • Continued strong growth in third quarter: – European PND market grew 80% y.o.y to 3.7m units – North American PND market more than tripled y.o.y to 1.8m units • Clear seasonal trend with significant underlying growth • Large fourth quarter expected Total PND unit sales per quar
Slide 7: Launch Real Time Traffic Solution
Launch Real Time Traffic Solution • Successful testing period of real time traffic concluded • Launch of traffic service in the Netherlands in November Current Coverage • UK roll-out planned first half 2008 • Discussions with operators for other countries progressing according to plan TomTom’s Cover
Slide 8: TomTom 2007 Priorities - Recap
TomTom 2007 Priorities - Recap • Deliver exciting roadmap of new products and services • Be first to market with key innovations • Maintain 50% market share in Europe and increase market share in North America • Roll-out travel time information service in the Netherlands and prepare for roll-out to
Slide 9: Fourth Quarter Business Outlook
Fourth Quarter Business Outlook • We are well positioned for the fourth quarter: – A leading European Market Share – Continued strengthening of our North American presence – Supported by new marketing campaigns • Broad portfolio of product and services lined up – In November we will launch our real
Slide 10: Third Quarter 2007 Financials
Third Quarter 2007 Financials © 2007 TomTom Third Quarter 2007 Financial Results
Slide 11: Financial Summary
Financial Summary in € millions Q3 ’07 Q3’06 ∆ Q2’07 Revenue 427 353 21% 380 Gross Profit 208 154 35% 169 Gross Margin 48.8% 43.5% - 44.6% Operating Profit 133 101 33% 93 Operating Profit Margin 31.3% 28.5% - 24.5% Net Profit 99 73 36% 68 Net Profit Margin 23.1% 20.6% - 18.0% * Percentages are based
Slide 12: Financial Summary
Financial Summary YTD YTD in € millions 2007 2006 ∆ Revenue 1,103 886 24% Gross Profit 496 360 38% Gross Margin 45% 41% Operating Profit 283 215 32% Operating Margin 26% 24% Net Profit 211 142 49% Net Profit Margin 19% 16% * Percentages are based on non-rounded numbers 12 © 2007 TomTom Third Quarter
Slide 13: Revenue by Product and Geography
Revenue by Product and Geography By Product Group By Geography FY 2006 FY 2006 5% ROW 2% 2% North America 8% Europe 90% 93% Q3 2007 Q3 2007 1% 6% ROW 4% North America 10% Europe 86% 93% PNDs PDA/smartphone solutions Other 13 © 2007 TomTom Third Quarter 2007 Financial Results
Slide 14: Third Quarter Revenue Analysis
Third Quarter Revenue Analysis Revenue (in € millions) ASP PNDs (in €) 427 23 400 6 380 21 200 353 14 7 285 3 100 195 184 300 0 Q3 '06 Q2 '07 Q3 '07 Units PNDs (in '000s) 200 398 352 336 2,000 1,500 100 2,160 1,000 1,807 1,180 500 0 0 Q3 '06 Q2 '07 Q3 '07 Q3 '06 Q2 '07 Q3 '07 PNDs PDA/smartphone sol
Slide 15: Operating Expenses Overview
Operating Expenses Overview in € millions Q3 ‘07 Q2 ‘07 Q3 ‘06 R&D 16.5 13.5 8.6 % of revenue 3.9% 3.6% 2.4% Marketing 21.1 33.3 15.5 % of revenue 4.9% 8.8% 4.4% Other SG&A 28.3 21.5 24.0 % of revenue 6.6% 5.6% 6.8% Operating expenses 65.9 68.3 48.1 % of revenue 15.4% 18.0% 13.6% Accounting charge f
Slide 16: Earnings Overview
Earnings Overview in € millions Q3 ‘07 Q2 ‘07 Q3 ‘06 Operating profit 133.5 93.4 100.6 Net financial income and expenses 0.3 (0.4) 3.3 of which FX losses (5.7) (5.0) 0.8 Taxation (35.2) (24.6) (31.2) effective tax rate 26.3% 26.5% 30.1% Net Profit 98.5 68.3 72.6 Average diluted shares outstanding (i
Slide 17: Cash Flow Overview
Cash Flow Overview in € millions Q3 ‘07 Q2 ‘07 Q3 ‘06 Operating profit 133.5 93.4 100.6 Depreciation and amortization 6.2 5.1 4.5 Additions to provisions 10.2 20.8 10.3 Changes in working capital 26.9 (14.8) 2.0 Other operating items 1.2 0.5 0.1 Cash generated from operations 178.0 105.0 117.4 Inter
Slide 18: Balance Sheet
Balance Sheet in € millions Q3 ‘07 Q2 ‘07 Q4 ‘06 Non-Current Assets Intangible Assets 56.5 59.8 39.2 Property, plant & equipment 14.3 10.3 7.9 Deferred Tax Assets 18.4 17.9 12.1 Current Assets Inventories 124.1 65.9 123.0 Receivables, Prepayments & Financial Instruments 279.7 283.4 283.0 Cash and Eq
Slide 19: Full Year 2007 Outlook Strengthened
Full Year 2007 Outlook Strengthened • European PND market of 15 - 16 million units • North American PND market of 8 - 9 million units • We expect our volumes of PNDs to double to between 9 million and 10 million units worldwide • We narrow our full year revenue guidance range to between €1.7 billion
Slide 20: Questions?
Questions? © 2007 TomTom Third Quarter 2007 Financial Results
Slide 21: Annex
Annex For further information please contact TomTom Investor Relations Tel: +31 20 753 5194 ir@tomtom.com www.investors.tomtom.com © 2007 TomTom Third Quarter 2007 Financial Results
Slide 22: Operating Expenses Overview
Operating Expenses Overview YTD YTD in € millions 2007 2006 ∆ R&D 40.6 23.4 73% % of revenue 3.7% 2.6% Marketing 75.2 56.2 34% % of revenue 6.8% 6.3% Other SG&A 72.4 51.4 41% % of revenue 6.6% 5.8% Operating expenses 188.3 131.0 44% % of revenue 17.1% 14.8% Accounting charge for share options 24.3 1
Slide 23: Accounting Charge for Share Based Compensation
Accounting Charge for Share Based Compensation • Under IFRS, share options have to be accounted in the P&L through a specific charge. • TomTom accounts for this charge as follows: – At the date of issuance, options are valued by a Black & Scholes model and the calculations are reviewed by our audito
Slide 24: Outstanding Shares
Outstanding Shares Common shares outstanding end of Q2 2007 113,284,572 Common shares outstanding end of Q3 2007 113,482,059 Average shares outstanding end of Q3 2007 113,421,954 Share options as of end of Q2 2007 10,290,915 Exercised share options in Q3 2007 197,487 Anti-dilutive shares options 0 A
Slide 25: Share Options Vesting Schedule
Share Options Vesting Schedule Number of options in 2007-2010 (in ‘000s) 1 Nov 1 Dec 10 Aug 10 Nov 28 Feb 9 May 8 Aug 9 Nov 8 Mar 2007 2007 2008 2008 2009 2009 2009 2009 2010 1,500 €3.75 182 €3.75 1,110 €26.44 3,308 €28.82 105 €25.50 113 €37.68 188 €28.58 1,705 €33.96 30 €30.91 At June 30 2007 there
Slide 26: End
End © 2007 TomTom Third Quarter 2007 Financial Results